First Quarter 2015

Genuine Parts Company Reports Sales And Earnings For The First Quarter Ended March 31, 2015

- Sales Up 3% and EPS Up 3% -

Apr 21, 2015
8:47am

ATLANTA, April 21, 2015 /PRNewswire/ -- Genuine Parts Company (NYSE: GPC) announced today first quarter sales and earnings for the quarter ended March 31, 2015.

GPC Logo

Sales for the first quarter ended March 31, 2015, increased 3% to $3.7 billion compared to sales of $3.6 billion for the same period in 2014.  Net income for the first quarter was $161.0 million, up 2% from $157.5 million recorded for the same period in the previous year. Earnings per share on a diluted basis were $1.05, up 3% compared to $1.02 for the first quarter last year. 

Tom Gallagher, Chairman and Chief Executive Officer, commented, "We are pleased to report a solid start to 2015 and, although our sales and earnings growth rates moderated from the results reported in recent quarters, we performed in line with our expectations.  Our total sales increase of 3% included approximately 4% underlying sales growth and a 1.5% contribution from acquisitions, offset by a currency headwind of approximately 2%.  Sales for the Automotive Group were flat with the prior year and consisted of core automotive growth of approximately 3% and a slight benefit from acquisitions, less the negative impact of currency of approximately 4%.  Sales at Motion Industries, our Industrial Group, were up approximately 3%, including 3% underlying growth and 1% from acquisitions, offset by a currency headwind of approximately 1%.  Sales at EIS, our Electrical/Electronic Group, increased by 1% and included approximately 6% growth from acquisitions, net of a 4% decrease in core sales and a 1% negative impact of copper pricing.  Sales for S. P. Richards, our Office Products Group, were up approximately 17%, consisting of 11% underlying growth and 6% from acquisitions."

Mr. Gallagher concluded, "Our sales and earnings growth in the quarter was supported by solid cash flows and a strong balance sheet.  As we move forward in the year, we are well positioned for further progress across our operations and remain optimistic that 2015 will be another successful year for the Company."   

Conference Call

Genuine Parts Company will hold a conference call today at 11:00 a.m. EDT to discuss the results of the quarter and the future outlook.  Interested parties may listen to the call on the Company's website, www.genpt.com, by clicking "Investors", or by dialing 844-857-1770, conference ID 10259415.  A replay will also be available on the Company's website or at 855-859-2056, conference ID 10259415, two hours after the completion of the call until 12:00 a.m. Eastern time on May 5, 2015.

Forward Looking Statements

Some statements in this report, as well as in other materials we file with the Securities and Exchange Commission (SEC) or otherwise release to the public and in materials that we make available on our website, constitute forward-looking statements that are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  Senior officers may also make verbal statements to analysts, investors, the media and others that are forward-looking.  Forward-looking statements may relate, for example, to future operations, prospects, strategies, financial condition, economic performance (including growth and earnings), industry conditions and demand for our products and services.  The Company cautions that its forward-looking statements involve risks and uncertainties, and while we believe that our expectations for the future are reasonable in view of currently available information, you are cautioned not to place undue reliance on our forward-looking statements.  Actual results or events may differ materially from those indicated as a result of various important factors.  Such factors may include, among other things, slowing demand for the Company's products, changes in general economic conditions, including, unemployment, inflation or deflation, high energy costs, uncertain credit markets and other macro-economic conditions, the ability to maintain favorable vendor arrangements and relationships, disruptions in our vendors' operations, competitive product, service and pricing pressures, the Company's ability to successfully implement its business initiatives in each of its four business segments, the Company's ability to successfully integrate its acquired businesses, the uncertainties and costs of litigation, as well as other risks and uncertainties discussed in the Company's Annual Report on Form 10-K for 2014 and from time to time in the Company's subsequent filings with the SEC.

Forward-looking statements are only as of the date they are made, and the Company undertakes no duty to update its forward-looking statements except as required by law.  You are advised, however, to review any further disclosures we make on related subjects in our subsequent Forms 10-K, 10-Q, 8-K and other reports to the SEC.

About Genuine Parts Company

Genuine Parts Company is a distributor of automotive replacement parts in the U.S., Canada, Mexico and Australasia.  The Company also distributes industrial replacement parts in the U.S., Canada and Mexico through its Motion Industries subsidiary.  S. P. Richards Company, the Office Products Group, distributes business products in the U.S. and Canada. The Electrical/Electronic Group, EIS, Inc., distributes electrical and electronic components throughout the U.S., Canada and Mexico.

        


GENUINE PARTS COMPANY and SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME




Three Months Ended March 31,


2015

2014


(Unaudited)


(in thousands, except per share data)




Net sales

$3,736,051

$3,624,897

Cost of goods sold

2,623,232

2,540,267

Gross profit

1,112,819

1,084,630




Operating expenses:



Selling, administrative & other expenses

825,554

803,802

Depreciation and amortization

35,884

36,856


861,438

840,658




Income before income taxes

251,381

243,972

Income taxes

90,371

86,488




Net income

$  161,010

$  157,484




Basic net income per common share

$1.05

$1.02




Diluted net income per common share

$1.05

$1.02




Weighted average common shares outstanding

152,656

153,729




Dilutive effect of stock options and



   non-vested restricted stock awards

918

1,067




Weighted average common shares outstanding – assuming dilution

153,574

154,796




     

GENUINE PARTS COMPANY and SUBSIDIARIES

SEGMENT INFORMATION AND FINANCIAL HIGHLIGHTS




Three Months Ended March 31,


2015

2014


(Unaudited)


(in thousands)




Net sales:



Automotive

$1,898,508

$1,898,515

Industrial

1,181,823

1,143,274

Office Products

490,298

418,098

      Electrical/Electronic Materials

182,046

180,331

Other (1)

(16,624)

(15,321)

Total net sales

$3,736,051

$3,624,897




Operating profit:



Automotive

$   150,641

$   150,110

Industrial

87,769

83,050

Office Products

36,524

33,946

Electrical/Electronic Materials

15,463

15,529

Total operating profit

290,397

282,635

Interest expense, net

(5,327)

(6,206)

Intangible amortization

(8,604)

(8,876)

Other, net

(25,085)

(23,581)

Income before income taxes

$   251,381

$   243,972




Capital expenditures

$     16,427

$     18,387




Depreciation and amortization

$     35,884

$     36,856







(1) Represents the net effect of discounts, incentives and freight billed reported as a component of net sales.

     

GENUINE PARTS COMPANY and SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS



March 31,

March 31,


2015

2014


(Unaudited)


 (in thousands)

ASSETS



CURRENT ASSETS



Cash and cash equivalents

$  166,495

$   103,472

Trade accounts receivable, net

1,978,233

1,828,309

Merchandise inventories, net

3,007,295

2,974,306

Prepaid expenses and other current assets

482,676

440,344




TOTAL CURRENT ASSETS

5,634,699

5,346,431




Goodwill and other intangible assets, less accumulated amortization

1,346,336

1,409,812

Deferred tax assets

144,112

92,539

Other assets

467,092

468,903

Net property, plant and equipment

646,116

664,689




TOTAL ASSETS

$8,238,355

$7,982,374


LIABILITIES AND EQUITY



CURRENT LIABILITIES



Trade accounts payable

$2,608,491

$2,335,327

Current portion of debt

393,697

399,756

Income taxes payable

26,479

76,682

Dividends payable

93,844

88,421

Other accrued expenses

636,850

522,552




TOTAL CURRENT LIABILITIES

3,759,361

3,422,738







Long-term debt

500,000

500,000

Pension and other post-retirement benefit liabilities

275,470

137,638

Deferred tax liabilities

67,672

87,726

Other long-term liabilities

444,810

423,063




Common stock

152,325

153,604

Retained earnings

3,855,295

3,641,920

Accumulated other comprehensive loss

(827,682)

(393,762)




TOTAL  PARENT EQUITY

3,179,938

3,401,762




Noncontrolling interests in subsidiaries

11,104

9,447




TOTAL  EQUITY

3,191,042

3,411,209




TOTAL LIABILITIES AND EQUITY

$8,238,355

$7,982,374








     

GENUINE PARTS COMPANY and SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS




Three Months Ended March 31,


2015

2014


(Unaudited)


(in thousands)

OPERATING ACTIVITIES:



Net income

$161,010

$157,484

Adjustments to reconcile net income to net cash provided by operating activities:



Depreciation and amortization

35,884

36,856

Share-based compensation

3,316

3,073

Excess tax benefits from share-based compensation

(3,734)

(4,106)

Changes in operating assets and liabilities

(73,964)

(133,528)




NET CASH PROVIDED BY OPERATING ACTIVITIES

122,512

59,779




INVESTING ACTIVITIES:



Purchases of property, plant and equipment

(16,427)

(18,387)

Acquisitions and other investing activities

(30,129)

(156,853)




NET CASH USED IN INVESTING ACTIVITIES

(46,556)

(175,240)




FINANCING ACTIVITIES:



Proceeds from debt

779,910

740,012

Payments on debt

(650,000)

(610,604)

Share-based awards exercised, net of taxes paid

(3,804)

(4,736)

Excess tax benefits from share-based compensation

3,734

4,106

Dividends paid

(88,039)

(82,750)

Purchase of stock

(84,252)

(22,709)




NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES

(42,451)

23,319




EFFECT OF EXCHANGE RATE CHANGES ON CASH

(4,740)

(1,279)




NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

28,765

(93,421)




CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

137,730

196,893




CASH AND CASH EQUIVALENTS AT END OF PERIOD

$166,495

$103,472

 

Logo - http://photos.prnewswire.com/prnh/20081002/CLTH108LOGO

SOURCE Genuine Parts Company

For further information: Carol B. Yancey, Executive Vice President and CFO - (770) 612-2044, or Sidney G. Jones, Vice President - Investor Relations - (770) 818-4628


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